On Contract Interpretation

The law of contract of PRC (here after referred to LOG) has been passed on the second session of the 9th NPC, 15th match, 1999 and has taken effect since 1st October ,1999. The making , decreeing and implementing of LOG will certainly play an important role in keeping the order of socialism market economy , in protecting the lawful right of the parties on both sides and will offer important protect of law for the development of transactions and the prosperity of market economy. The LOG is a very important part of the civil law and is the most basic Law of the socialism market economy law system. In market economy, contracts are the most important interlink of market economy activities and is closely related to company and enterprise's production and people's life. It can be said that all transactions are carried out by the making and implementing of contracts. So , relations of contracts are the basic legislate relations in the market economy and the LOG since becomes the most basic law to adjust relations of market economy activities.In practical life, nearly all the contracts are imperfect. The reasons lie in many aspects. For example, where they end their conference, the agents are always inclined to pay attention to their own promise, while ignore many other aspects that may arise; the agents delay the implementation, the place of implementation wrong, the means of implementation is improper, or they do not implement it at all, and so on. Usually, they don't regulate the influence or effect of this kind of breaking contract, and they even think such a case may never happen, for what matters to them is just to achieve some certain agreement, or they don't want to defer the conference by continuously asking the other party whether ready or whether they have the ability to carry out theagreement. In fact, no contracts can achieve the standard of perfection. Even though the agents on both sides and their legal advisors have simultaneously made all their efforts when drawing up the contract, there will still be indefinite and omitted when this happens an explanation for the contract is essential.The 125 th item in the contract law of our country has made a principled stipulation, which undoubtedly has a great guiding effect on researching theories and trying practice .But the explanation for contracts is an extensive question with strong theory and knowledge. As for the same contract, different people may have different explanation , so it is easy to cause the phenomenon of varied views and opinions , therefore , it will affect the staticity of the application of law .so it is essential to profoundly discuss and explore the explanation the contract law.This article intends to sum up the contract explanation and simply explain it in 5 aspects; the contract explanation and summary, the principle and the means, the relative rules in foreign laws , the institution of contract explanation in our country , and the application of it in the practice of justice administration. At the same time ,confming the research of comparison on the contract explanation institution both internal and external. It cases its superficial opinion on the defect of our design of contract explanation institution and the improvement of our current contract explanation institution . The article eventually explores and studies the problems lying in the process of application according to the contract and how to operate it scientifically . of course , since my theory level and practical experience is limited, the deficiency is inevitable .1 sincerely hope that experts and professors could give me some advice.